Barry Cheung's legal woes continues as he is sued over HK$30m loan
Former Executive Council member Barry Cheung Chun-yuen is facing more legal woes after a finance company sued him for failing to repay a loan of more than HK$33 million.
Former Executive Council member Barry Cheung Chun-yuen is facing more legal woes after a finance company sued him for failing to repay a loan of more than HK$33 million.
This is the fifth lawsuit to hit Cheung, a key supporter of Chief Executive Leung Chun-ying, since his Hong Kong Mercantile Exchange surrendered its trading licence in May.
The latest lawsuit takes the total claims against Cheung and his companies to HK$88 million. But he said last week that he hoped to be able to settle his debts within weeks, after HKMEx staved off eviction by paying HK$6 million in back rent on its offices in Cyberport, Pok Fu Lam, to landlord Cyberport Management Company.
According to a writ filed with the High Court, Cheung and his company New Effort Holdings, the majority shareholder in HKMEx, failed to repay HK$30 million borrowed from Sinomax Finance in April.
The company claims Cheung acted as guarantor for the loan, which was due to be repaid a month after it was taken out. The monthly interest rate was 2.5 per cent and the company claims the repayment deadline was later extended to the end of June.
Cheung was said to have made interest payments of HK$750,000 each in May and August, according to the writ. But by yesterday, with interest accrued, the outstanding balance on the loan was HK$33.5 million.
Cheung, who declined to comment yesterday, was in financial difficulties by the time of the original repayment date on May 16. Two days later, he revealed to the media that HKMEx was surrendering its licence as it did not meet the regulatory requirement that an exchange have sufficient cash on hand to cover nine months of operations.
Cheung quit the Exco and all his other public posts after being invited to assist in a police investigation into false documents linked to HKMEx.
Malaysian businessman Ong Shen Kuo was last month jailed for six months after admitting possessing a false document showing he had US$516 million in funds, which was seized from Cheung's office at the exchange.
While the judge at Eastern Court urged police to investigate Cheung, Cheung said his commodities trading platform was a victim of crime as it had received the false document.
